Endogenous glucose production (EGP) is elevated in type 2 diabetes mellitus (T2DM), and is the main cause of fasting hyperglycemia. Rising glucose levels rapidly suppress EGP in nondiabetic individuals, mainly by inhibiting glycogenolysis. Worsening hyperglycemia in T2DM is associated with loss of the suppressive effects of glucose on EGP. Little is known about the pathogenesis of this loss of 'glucose effectiveness'in T2DM, despite its important contribution to worsening metabolic control. Although T2DM is known to be associated with increased gluconeogenesis and decreased glycogenolysis, the impact of hyperglycemia on these pathways has never been examined in T2DM subjects. We will use 'state-of-the-art'techniques of pancreatic clamp studies, radiolabeled and stable isotope tracers, and NMR spectroscopy to study the impact of hyperglycemia on hepatic glucose fluxes. Two approaches will be used: a) comparing these responses in poorly controlled T2DM individuals versus age- and SMI-matched non-diabetic subjects, and b) prospectively determining the impact of normalizing glycemic control. Of note, we have shown that intensive insulinization for only 72 hours completely restores glucose effectiveness in T2DM along with normalizing FFA levels. Indeed, the chronically elevated free fatty acid (FFA) levels in T2DM may impair hepatic glucose effectiveness. We will contrast the acute effects of raising FFA levels in nondiabetic subjects vs. lowering FFA levels in T2DM on the regulation of hepatic glucose fluxes. While increased FFA are known to stimulate gluconeogenesis, it is not known whether or how an increase in this pathway would impact glucose effectiveness. Since glucose and basal insulin both inhibit lipolysis in nondiabetic individuals, we will determine whether these inhibitory effects are impaired in T2DM and whether they are restored by correcting the metabolic defects. Given the importance of the loss of hepatic 'glucose effectiveness'to worsening hyperglycemia in T2DM, elucidating these relationships would be of considerable therapeutic relevance.